DVC T &C Personal Use - Only Thread to Discuss!

[muppets3d]

Disney does not particularly care about this.

Though I would definitley agree that if the resale market collapses, there is no resale market.


I like the MouseSavers one. The assumptions they use are overly-favorable to buying vs. renting (they have the purchase price at $210 and rental rates at $23) but the underlying spreadsheet can be modified to something more reasonable.

https://www.mousesavers.com/other-disney-vacations/disney-vacation-club/#opportunity

So if I ran that correctly, assuming I bought 160 Riviera points today (enough points for a week's stay during the summer in a preferred view studio, nothing ostentatious) - versus renting at $20 a point, I wouldn't come out ahead with my purchase until 2066, and the resort expires in 2070.

Care to comment @tjkraz ?

 

[Genie+]

In general, I don’t like changes to a contract once they’re signed could you imagine if you rented an apartment and the owner could change the lease at any time they felt like it?

Real estate TS or real property transactions should have consistent contracts. If they want to change policy, make it for the new owners moving forward.

I think it is just better enforcing the contracts as already written.

Our ‘lease’ says for personal use.

If I rented an apartment with a contract stipulating ‘for personal use only’ and ‘commercial activity prohibited’, even though it allows an occasional subletting, and I entered 4 of these contracts with plans to only ever stay in one while renting the other 3…

A good argument can be made for how only 25% of my leases meet the personal use criteria. Legally subletting for summer does not mean I can plan to rent out as much as my heart desires. At some point it crosses beyond being for personal use, especially if I’m consistently selling out the highest profit weeks to AirBnB/VRBO and the neighbors who are actually using their lease for personal use are negatively impacted due to that. In DVC’s case it availability, in this apartment’s case it may be quality of everyday life. Either way, if it’s changing the product, management can decide to more strongly enforce the existing contracts as written.

 

[VGCgroupie]

I'm taken aback but I guess really not surprised with the posts I've seen where people say they can't afford their dues without renting. Suggestion to new buyers: Buy however many points you can easily afford and use them for vacations.

Was going to add this to my multi response but I think it's important so I will comment on it independently.

100% If you cant afford your car payment w/o doing DoorDash every now and then maybe buy a cheaper car. Things can always happen (umm hello 2020) and you might not be able to rent so it is not worth the risk owning something you cant afford to pay for.

There is risk in renting for both the owner and the renter. When you rent you are assuming all liability for whatever that renter may do to the room. While this is likely never to happen what if they trash the room and you get sent a bill for $5,000? I assume you cant afford that either.

Yes you can rent every now and then to help offset dues when you aren't going, why pay dues on unused points but you really shouldn't be buying more than you can afford to pay dues for.

 

[Sandisw]

One rental a year is certainly regular and is a pattern. But I don't know what frequent means to Disney. Is an annual visitor a "frequent" visitor, for example? If so, then an annual rental may be considered both regular and frequent.

That's why coming up with scenarios is a waste of time.

Based on the way FL law seems to be written, I don’t beleive regular can’t be that narrow.

Regular to me means monthly or close to it, year after year, and frequent means more than one every month.

A few rentals a year…which may not even be rentals…could be gifts….seems reasonable to me.

But, who knows. What we all need to accept is that whatever DVc uses as the line in the sand, we have to accept it.

 

[Mouseforward]

One rental a year is certainly regular and is a pattern. But I don't know what frequent means to Disney. Is an annual visitor a "frequent" visitor, for example? If so, then an annual rental may be considered both regular and frequent.

This reminds me of a company meeting where we were all told that it was unacceptable that 40% of our sick days were on Mondays and Fridays. Some people understand math some just don’t.

If members can’t rent stray points it seriously devalues your contract. Just this year my waitlist came through at beach club and it took over for my poly week. Since beach club was less points that means I have 23 points that were borrowed and I’m stuck with. You bet I’m renting them. I’m not giving Disney 23 points.

Stray points is a common issue when when you have multiple contracts. Unless you can book last-minute trips to SSR renting is really the only way you can get rid of them.

 

[Mouseforward]

It seems to "prove the point" that buying Grand Californian for $330 or Beach Club for $275 direct is a poor decision. We didn't need a chart to know that.

I don't see the issue with something like Riviera. Especially since the $235 rate listed ignores current incentives. It's at least $24 per point cheaper on 200 points, before Visa incentive, Magical Beginnings and whatever else they're

Magical beginnings doesn’t count you’re just basically renting points.

And you’re seriously underestimating time value of money. If you put the money in an account and rent it each year using those funds, you will come out ahead. Riviera and copper creek resale are probably the only two where that’s in doubt.

 

[Genie+]

This reminds me of a company meeting where we were all told that it was unacceptable that 40% of our sick days were on Mondays and Fridays. Some people understand math some just don’t.

If members can’t rent stray points it seriously values your contract. Just this year my waitlist came through at beach club and it took over for my poly week. Since beach club was less points that means I have 23 points that were borrowed and I’m stuck with. You bet I’m renting them. I’m not giving Disney 23 points.

Stray points is a common issue when when you have multiple contracts. Unless you can book last-minute trips to SSR renting is really the only way you can get rid of them.

And I think your case is something DVC shouldn’t have issue with. Clearly you had intention of using the points.

But what if you already had excess points and just kept buying more and more contracts, never increasing your own personal usage? Suspicious enough to take a further look.

 

[muppets3d]

This reminds me of a company meeting where we were all told that it was unacceptable that 40% of our sick days were on Mondays and Fridays. Some people understand math some just don’t.

If members can’t rent stray points it seriously devalues your contract. Just this year my waitlist came through at beach club and it took over for my poly week. Since beach club was less points that means I have 23 points that were borrowed and I’m stuck with. You bet I’m renting them. I’m not giving Disney 23 points.

Stray points is a common issue when when you have multiple contracts. Unless you can book last-minute trips to SSR renting is really the only way you can get rid of them.

I really don't like the ad nauseum scenarios that people get into on discussion forums, we can "what if" this forever.

 

[Brian Noble]

So when someone says they’re ok with their contracts being valued at $0, I see it as they’re saying “I’m ok if these changes cause devaluation of what I own because the others doing things I don’t like will be having a worse time than me”.

I'm in this camp, but not for the reason you suggest.

When I made my decision to buy, I did so under the assumption that my resale value would be zero, and I consider any salvage value to be found money. So, I am not disturbed by the idea that my contract might be worth $0 when I want to dispose of it, but it is also true that if it is better-than-$0, I'd welcome it.

The practical. impact of this is that I don't particularly care if Disney takes steps to devalue the resale market. That's partly because I've been watching them do exactly that for almost 15 years now, so I assumed they'd keep at it.

So if I ran that correctly

I come up with an earlier break-even---about halfway through. This is partly because I think the TVOM rate of 6.5% is on the high side, and I dropped that down a little bit. This also assumes a $0 salvage value, which is what I prefer but also quite conservative. I suspect if I sold RIV 20 years from now, it would have some residual value, but the rental account is tapped.

So I think there is a good argument that buying has small but real advantage over renting from an owner. What's more, there are some components of ownership that deliver more value. In particular, I don't have to spend the time and effort to go through a third party to make the reservation, and I have direct control so modifications etc. are much simpler.

 

[WhitneyMB]

Does it apply just to the portal? What if someone calls MS.

I just make a reservation by phone with an otherwise lovely cast member and was straight out asked if the booking was for personal usage. I was taken back for a moment and felt defensive (although it was for personal use). Definitely, something to adjust to!

 

[Kingkonig]

And you’re seriously underestimating time value of money. If you put the money in an account and rent it each year using those funds, you will come out ahead. Riviera and copper creek resale are probably the only two where that’s in doubt.

Exactly. Any argument that “Disney could lose out on sales from people who are more financially savvy who are concerned about the resale market” doesn’t really carry water here. It’s a timeshare. There’s no world where buying for personal use is a financially sound investment. Yes there are times where speculatively purchasing large numbers of points and then renting them out are - there’s entire business models based off of this, and it’s what Disney is trying to quash right now!

We bought DVC because it was something we wanted to buy, we were able to get in the Riviera cheaper than had we paid cash reservations, and easier and less of a headache/hassle than renting from a third party. But it wasn’t the best financial move we’ve ever made. Kinda like buying a Lexus vs a Toyota. Never a real financial justification outside of “it’s something I want”

 

[Brian Noble]

One more observation about the buy vs. rent thing: One of the consequences of Wyndham's moves is that renting Wyndham has become more expensive. If Disney is successful, renting DVC will may likewise become more expensive.

 

[VGCgroupie]

You know that part of the concern of potential timeshare buyers is the committment and future cost.

One of the big sales points is the flexibility that if you have a year you can’t go, it’s easy to rent your points that year.

Same with resale value. What has been the biggest con shared about investing in RIV…it’s resale value is not going to hold up.

So, I can see how many owners out there may be currently renting to cover dues so they can still afford to go.

It’s why this is going to be interesting to watch where DVC draws the enforcement line.

This is not the same as buying double points to pay the dues on your on the other half of your points. Knowing full well you cant afford the dues in its entirety. That is irresponsible and fellow owners should not want owners that can potentially go to foreclosure because they bought more than they could afford. Again.. things happen and renting is not always an option (2020). Also, if they cant afford dues then then they cant afford if a room gets damaged by a renter and the rest of the owners then hold the financial responsibility for paying to repair that room.

Dont buy a house you cant afford assuming you can rent the basement.

Sorry this was partial repeat but I think it's an important point. While 2020 and rooms damages are rare... it can happen.

I truly do not think that even some of the informed DVC members (represented by many on these forums and others) realize how bad the issue has become, and that is to say nothing of the vast majority of DVC members being completely oblivious. There are places that have over 300 AKL value reservations by one renter for the next 11 months. The abuse happening has widespread affects, and anyone not championing enforcement by DVC is “sus” as the kids say.

It’s impossible for this to not have a positive net effect for the membership. It’s like an organized crime syndicate being dismantled. Occasional renters here who are complaining should consider that rental price is relative to supply and demand. Did anyone consider that the demand for rentals will not be going down, and the supply of rentals will, so the price per point for you should increase. Being able to say “I’m not a commercial renter so your reservation is safe” is a good advertisement for someone who does a rental every other year or so.

The narrative steering is becoming so obvious now that it’s laughable. The best thing everyone can do is to write to the DVC member services and encourage them to take the gloves off and show no mercy.

100% I would post screenshots if I was allowed maybe that would change some peoples minds

 

[gsdweller]

We also bought assuming that any resale value would be zero. We bought at VGC before it exploded in price. We have already passed the break-even point. Even if we didn't ever break even, staying in a 1 or 2 bedroom with a full kitchen and laundry right next to the parks is still worth it, and I would pay it again.

 

[Mouseforward]

I At some point it crosses beyond being for personal use, especially if I’m consistently selling out the highest profit weeks to AirBnB/VRBO and the neighbors who are actually using their lease for personal use are negatively impacted due to that. In DVC’s case it availability, in this apartment’s case it may be quality of everyday life.

Claiming a negative impact is false. There are more people wanting the rooms than rooms. There’s no way that they would’ve gotten the room if you didn’t rent and used your points instead you would’ve gotten in the room and they still would be out of a room.

 

[AstroBlasters]

I really don't like the ad nauseum scenarios that people get into on discussion forums, we can "what if" this forever.

Sorry if real world scenarios don’t fit your predetermined narrative.

 

[tjkraz]

So if I ran that correctly, assuming I bought 160 Riviera points today (enough points for a week's stay during the summer in a preferred view studio, nothing ostentatious) - versus renting at $20 a point, I wouldn't come out ahead with my purchase until 2066, and the resort expires in 2070.

Care to comment @tjkraz ?

The default spreadsheet as displayed shows purchasing 160 Riviera points breaks-even in 2045 and saves $437,000 by 2070 vs renting at $23.

Lowering the starting rental to $20 moves the breakeven to 2054 with savings of $197k by 2070. That takes into consideration increases in dues and rental rates, along with time value of money.

We can fiddle with the rental figure and claim "oh, I can always find someone to rent for $15." Not sure how accurate that is over the long haul. Cheaper rentals tend to be distressed points. At a minimum, that means you're paying more points for a larger room or "better" view. 160 points will yield 5 nights in a Standard view One Bedroom. But if you're forced to book a Preferred view, you need to rent 180 points. Owners aren't making 11 month rental reservations at Riviera for $15 per point.

That's with minimal control over the rental reservation, no member perks, no asset that can be re-sold along the way, etc. At the 15-year mark, the renter will have spent $64,000 with nothing left to show. The owner will have a 160-point DVC contract with 30 years remaining that's reasonably worth at least $20-25k.

I still have the spreadsheet I made before buying where I projected the prevailing rental rate in 2025 to be $13 per point. I kinda missed on that one.

 

[Genie+]

One more observation about the buy vs. rent thing: One of the consequences of Wyndham's moves is that renting Wyndham has become more expensive. If Disney is successful, renting DVC will may likewise become more expensive.

Interesting! I wouldn’t have guessed it but now you mention it, I can see how that is possible.

 

[tx911]

I don’t care if I never get any money back resale. If all the money is just money spent on vacations, I’m good with it.

 

[VGCgroupie]

This whole take on wanting a “full crackdown” is a little much. This is meant to address commercial rentals. That is a legal term. This is meant to stop people from using DVC rentals as a for-profit business. Disney knows exactly who these owners are. They can see the behavior clear as day on their side. If you have thousands of points and a bunch of reservations and they are almost always not in your name as lead guest, and you play all of these reservation games being discussed on here, this is directed at you. It’s going to be very interesting to see what enforcement looks like. Do they suspend your ability to make reservations where the owner isn’t the lead guest, do they move to cancel the contract? Do they cancel the reservations already made with guest names (renters) on them? I’m skeptical of the last option. At the end of the day that family is their guest. They don’t want to hurt that relationship if they can help it. I bet you see action against the owner not the renter because the owner is the one doing something wrong. Renting points is allowed. I don’t think this is meant to dissuade normal members from renting unused points - life does happen. If they move to take away that right, then resale prices will plummet because you are placing more financial risk on the owner, no way around that fact.

Yeah I think I have only seen one person say no renting at all, and maybe they didnt even go that far. Most of this thread is about DVC cracking down on commercial renting and people just being ultra paranoid they might get cracked down on when they aren't running a commercial enterprise. Its irrational.

The rest of this thread is about some thinking avialibity wont get any better some thinking it will. I haven't seen a BAN RENTING in this thread I am not sure what you are reading but we are not reading the same thing.